Question:
A scooter is bought for Rs 32000. Its value depreciates at 10% per annum. What will be its value after 2 years?
Solution:
Let the principal amount be $P=\mathrm{Rs} 32000$.
Rate of interest $(R)=10 \%$
Time $(n)=2$ years
Now, $\mathrm{A}=$ Rs. $\mathrm{P} \times\left(1-\frac{\mathrm{R}}{100}\right)^{\mathrm{n}}$
$=$ Rs. $32000 \times\left(1-\frac{10}{100}\right)^{2}$
$=$ Rs. $32000 \times\left(\frac{90}{100}\right)^{2}$
$=$ Rs. $32000 \times\left(\frac{9}{10}\right) \times\left(\frac{9}{10}\right)$
$=$ Rs. $(320 \times 9 \times 9)$
$=$ Rs. 25920
$\therefore$ The value of the scooter after 2 years is Rs 25920